U.S. Stocks Fall; Cigna Net Slumps

Arthi Gupta
05 Aug, 2010
New York City

U.S. stocks decline after weekly jobless claims rise 19,000 to 479,000. The Monster Employment Index falls in July. BP gets authorization for cementing procedure on leaking Gulf of Mexico well. Intel and FTC reach settlement on antitrust lawsuit.

[R]9:45 AM New York – U.S. stocks decline after weekly jobless claims rise 19,000 to 479,000. The Monster Employment Index falls in July. BP gets authorization for cementing procedure on leaking Gulf of Mexico well. Intel and FTC reach settlement on antitrust lawsuit.[/R]

U.S. stocks fall after disappointing jobless claims data, Asian markets traded mixed, and European markets traded sideways.

The Bank of England left its key interest rate unchanged at a historic low again. The Monetary Policy Committee decided to retain the interest rate at 0.5%.

The U.S. Labor Department said today that first-time claims for unemployment benefits unexpectedly showed a moderate increase in the week ended July 31. Initial jobless claims rose to 479,000 from the previous week revised figured of 460,000.

The preliminary insured unemployment rate in the week ending July 24 fell to 3.6% from the prior week''s unrevised rate of 3.6%.

The U.S. Monster Employment Index dropped 3 points in July as online job availability eased with a decrease in summer hiring activity.

The employment index fell to 138 in July from 141 in June, according to Monster Worldwide Inc. The report showed that online job availability rose in eight of the Index''s 20 industry sectors and in eight of the 23 occupational categories monitored.

National Incident Commander Admiral Thad Allen authorized BP plc to cement the damaged well in the Gulf of Mexico based on the successful completion of the ""static kill"" procedure and a positive evaluation of the test results. Allen added that implementation of this procedure shall in no way delay the completion of the relief well.

Pumping operations are expected to begin on Thursday, August 5th. The aim of the procedure is to assist with the strategy to kill and isolate the well, and will complement the upcoming relief well operation.

The U.S. Federal Trade Commission reached a settlement with Intel Corp. in the antitrust lawsuit that resolves charges that the company illegally stifled competition in the market for computer chips and abused its market dominance. The settlement ensures that makers of complementary products such as discrete graphic processing units will be assured access to Intel''s CPU for the next six years.

The FTC sued Intel alleging Intel had violated Section 5 of the FTC Act. The agreement approved today by the Commission is subject to a 30 day public comment period and final approval by the Commission.

The FTC noted that the settlement prohibits Intel from using threats, bundled prices or other offers to exclude or hamper competition, and bars Intel from retaliating against computer makers if they do business with non-Intel suppliers.

""This agreement provides a framework that will allow us to continue to compete and to provide our customers the best possible products at the best prices,"" said Doug Melamed, Intel senior vice president and general counsel. ""The settlement enables us to put an end to the expense and distraction of the FTC litigation.""

Earnings Review

Cigna Corp., the health-service firm said second-quarter revenue rose 19.2% to $5.35 billion from $4.49 billion. Net profit slumped 32% to $294 million or $1.06 per share, compared with $435 million or $1.58 per share in the same period last year. The company estimates full-year earnings per share, on an adjusted income from operations basis, to be in the range of $4.10 to $4.40 per share.

Teradata Corp., the enterprise data warehousing solutions provider quarterly revenue advanced 12% to $470 million from $421 million in the same quarter of last year. Net income in the quarter rose 19.4% to $74 million or 44 cents per share from $62 million or 36 cents per share in the year-ago quarter.

T-Mobile USA Inc., the U.S. wireless operation of Deutsche Telekom AG reported second quarter total revenues rose marginally to $5.36 billion from $5.34 billion in the year-ago quarter. Net income in the quarter fell 4.9% to $404 million compared to $425 million in the prior-year quarter. OIBDA for the quarter declined 11.3%% to $1.42 billion from $1.60 billion in the previous year quarter.

Total customers served declined by 93,000 in the second quarter of 2010, compared to 325,000 net customer additions in the second quarter of 2009.

Time Warner Cable, the cable operator reported second quarter revenue increased 5.8% to $4.73 billion from $4.47 billion in the second quarter of 2009. Net income edged higher 8.2% to $342 million or 95 cents per share, compared with $316 million or 89 cents per share a year ago.